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Fitch expects offshore life reinsurance volumes to stay elevated

Bermuda accounted for 85% of offshore life reinsurance in 2025, as offshore reserves ceded by U.S. life insurers rose to $1.3 trillion that year.

Reported · Written up by our desk · Reinsurance

Fitch Ratings expects strong growth in offshore life reinsurance to continue, with Bermuda remaining the dominant primary jurisdiction, according to Reinsurance News.

The ratings agency said offshore reserves ceded by U.S. life insurers have nearly doubled since 2020, reaching $1.3 trillion in 2025. It also noted that, at year-end 2025, 72% of offshore reinsurance was affiliated, pointing to capital optimization as a main driver.

Fitch added that the share of reserves ceded to reinsurers affiliated with alternative investment managers rose to 44% in 2025, from 30% in 2021. Bermuda represented 85% of the offshore reinsurance total in 2025, and Fitch cited what it sees as a more robust and transparent regulatory regime, including Solvency II equivalence and NAIC reciprocal jurisdiction status.

Fitch said Bermuda strengthened its regulations in 2024 through a second consultation paper, which it linked to enhanced governance, higher fees, and greater conservatism for reserving and capital standards. It expects some moderation in sales growth for full-year 2026, but anticipates offshore reinsurance volumes will remain elevated, supported by insurer and alternative manager partnerships, sidecars, and block reinsurance.

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